Small business owners who feel that discriminatory practices have prevented them from successfully growing their business and gaining access to contracting opportunities in the federal contracting marketplace don’t have to look any further than the U.S. Small Business Administration’s (SBA) 8(a) business development program.
Program participants must be owned by people who meet the SBA definition of socially and economically disadvantaged individuals––those who have been subjected to racial prejudice or cultural bias. Because of this discrimination, these entrepreneurs have less access to capital and credit, which diminishes their ability to compete in the federal contracting marketplace. The 8(a) program helps these firms develop their business and provides them with access to government contracting opportunities, allowing them to become solid competitors in the federal marketplace.
Members of minority groups, which include African Americans, Hispanics, Native Americans, Asian Pacific Americans, and subcontinent Asian Americans, are among those presumed to be socially and economically disadvantaged. Others, who may not be members of one or more of those groups, can be considered for the 8(a) program if they are able to provide substantial evidence and documentation that they have been subjected to chronic racial prejudice, cultural bias, or similar circumstances beyond their control.
Participation in the 8(a) program is based on a nine-year term, beginning the date of the firm’s acceptance into the program. The program term consists of a four-year developmental stage and a five-year transitional stage. After nine years in the 8(a) program, the firm is eligible for graduation. The SBA may also terminate a firm’s participation for noncompliance of program requirements and regulations. The small business may also withdraw at any time.
The 8(a) program’s business development assistance includes specialized business training, counseling, marketing assistance, and high-level executive development provided by the SBA and its resource partners. The SBA also assigns business opportunity specialists to 8(a) participants to help them receive training and gain access to opportunities in the areas of procurement, marketing, finance, management, and surety bonding.
Although the SBA’s business opportunity specialists work hard to provide 8(a) program participants access to federal contracting opportunities by maintaining close contact with federal agencies, the SBA emphatically encourages 8(a) participants to self-market their firms. The SBA cannot guarantee any specific amount of government contracts for any 8(a) firm. However, the SBA does maintain data on government requirement trends to anticipate the nature and volume of business opportunities.
To become eligible for the program, a small business must fit the definition of socially and economically disadvantaged, must fall within the SBA’s size standard as a small business, and must be 51% owned by a person(s) who are classified as socially and economically disadvantaged. The owner(s) must also be engaged full-time in the daily operation and management of the business.
The SBA presently has more than 9,800 8(a) certified firms ranging from janitorial and engineering services to information technology. In fiscal year 2006, 8(a) firms received $12.5 billion in contract dollars.
Small businesses interested in the 8(a) program should contact their local district office to attend an informational session on the program. The SBA has nearly 70 district offices nationwide, at least one in every state. An online 8(a) application can be found here. Visit the same Website for more information about the 8(a) program.
Joseph Loddo is the district director of the Washington Metropolitan Area District Office of the Small Business Administration.